Civ Pro Long Outline

PERSONAL JURISDICTION Ex. Pennoyer v. Neff o Ever since Pennoyer v. neff plaintiffs are not free to bring suit wherever they choose o You establish personal jurisdiction through presence and consent o Traditional basis of jurisdictions Presence PJ over any defendant who can be served with process within the borders of the state, no matter how long he was present (even if passing through). Exception: special appearances can be entered so you can show up at court and you wont get served while you are there. Consent Express Consent: By contract or appointment Implied Consent: When the state has substantial reason to regulate the in-state activity of a nonresident of the state, it may provide that by engaging in such activity, the nonresident thereby consents. Supreme Court has upheld statutes that use implied consent to a nonresident motorist to jurisdiction in any stat in which he has an accident: o Hess v. Pawloski: States enacted nonresident motorist statutes that say if you come into our state, and come on our roads and you get into an accident while you are here, we can have PJ over you and any cause of action that materializes from you driving on our highways courts say

this is constitutional and fair and reasonable Domicile If you live in that state, you can have jurisdiction exercised over you there. Can exist even when the defendant is not physically within the state when served with process. LONG ARM STATUES AND DUE PROCESS ANALYSIS PERSONAL JURISDICTION Most important part! STEP 1. On exam always examine the long-arm statue THEN due process analysis to establish personal jurisdiction, dont ever stop at long arm even if the long arm doesnt establish it STEP 2. Due process Analysis: o Step 1. Establish that there are sufficient minimum contacts o Step 2. Analyzed Relatedness (specific Jurisdiction) o Step 3. Analyze Reasonableness Due process clause o requires that in order to subject a defendant to a judgment in personam, if he be not present in the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice. Long-Arm Statue o A statue which permits the court of a state to obtain jurisdiction over persons not physically present within the state at the time o Ex. Hess v. Pawloski Hess from PA injured Pawloski while driving on the MA highway. Hess had to pay bc MA had a long arm statue that when you drive on highway, you give consent o Ex. Burger King v. Rudzewicz Rudzewicz opened a burger king in Michigan and failed to give them payments. Burger King corporation is in 2

Miami. BK won because Florida has a long-arm statute that extends jurisdiction to any person, regardless of location or citizenship, who breaches a contract that involves acts to be performed in Florida. o "one-publication rule," for defamation claims if there is one publication in the State that defames you, that Court will adjudicate the damages for defamation in all States. This way you don't have to sue in every single State. o But For vs. Proximate cause in ruling on long-arm statues On exam: address the spilt in the courts and say something like if they take a but for causation, it could be enough but if they take a proximate causation, it may not be. Make sure to address the split! But For Marino v. Hyatt: P is a citizen of MA. D is a DL corporation with p/p/b in IL. Cause of action = slip and fall in hotel in Hawaii. Filed in FEDERAL COURT. Long-Arm 3(a): cause of action arising from persons transacting any business in this commonwealth. Hyatt transacts business in MA take reservations from people who are in MA, they have hotel in MA, and advertise in MA. Plaintiff argues the cause of action arises from the making of the reservation and try to tie the making of the reservation to the guarantee of safety. Court held NO this safety comes into play when you get there and assigned room. o The only connection is a but for but for making the reservation, they would not be at the hotel. o Federal court interpreted the MA longarm as not a but for causation. They 3

said this was not enough and the connection was not strong enough. ** This is a federal court construing the state long-arm statute, deciding that the long-arm must have more than a but for connection. ** Tatro v. Manor Care: P is a citizen of MA. D is a DE/CA corporation. Cause of action = slip and fall in CA. Long-arm provision same as Marino. Filed in STATE COURT. Defendant has relationships with businesses in MA and gives them a free conference room if they come to their hotel. They solicited their business, which would qualify as transacting business in MA under the long-arm. This court held the cause of action DID arise from the transaction of business. MA said: this but for causation is enough for us to have jurisdiction o So, now the state of MA goes by this decision because this is controlling. The state wants to protect their citizens and if you are a hotel and transact business in MA, and they go and get injured on your premises, the MA long-arm reaches you and we can assert jurisdiction over you here in MA so our residents dont have to travel to where the hotel was in order to sue. Nowak v. Tak How: Filed in Federal Court and they must follow what the state did in Tatro and follow a but for causation. P is MA citizen. D is a Hong Kong Corporation. Cause of action =

drowning in hotel pool in Hong Kong. Remember: TATRO is controlling here. They are transacting business here and the issue is if the cause of action arises for this transaction of business but for Proximate Cause Distinguishes between foreseeable and unforeseeable risks Allows the defendant to foresee things happening. Gives a defendant more of an idea what it might do in the forum that would lead to a cause of action that would lead them to jurisdiction (i.e. enables defendants to anticipate what conduct will be subject them to personal jurisdiction). The result must be a proximate cause of the defendants actions. Stricter test.

A. MINIMUM CONTACTS Courts may not exercise jurisdiction unless the defendant has minimum contacts Need purposeful availment o Defendant must have taken actions that were purposefully directed toward the forum state and have it be foreseeable to go to court there o Foreseeability A reasonable expectation that an act or omission would occur Along with minimum contacts for establishing jurisdiction it also has to be reasonable Ex. World-Wide Volkswagen Corp. v. Woodson Robinsons were injured in an Oklahoma car accident by car purchased by Seaway in NY. In this case, Seaway, had not purposely availed itself of the opportunity to conduct activities in OK, although it could foresee that its buyers might take its cars there. The dealer has not sold cars there, advertised there, cultivated OKs 5

customers, or deliberately focused on OK as a market. There is a requirement that a defendant must reasonably anticipate where its conduct will subject it to personal jurisdiction. The defendant must do more than place a product in the stream of commerce to establish minimum contacts Ex. Asahi Metal Industry Co. v. Superior Court Asahi an Asian corporation was sued bc of faulty motorcycle part that caused accident in CA. Was sold to CA through other Asian tire maker. Asahis actions could constitute sufficient minimum contacts if it advertised or marketed its products in California or deliberately designed them to conform to unique California regulations. Asahi however has not engaged in these activities and has done nothing to indicate that it deliberately wants to see its products used in California. Look to C for 5 reasonableness factors if stream of commerce case meaning that a product of the defendant has caused harm to the plaintiff only after traveling through the stream of commerce do the facts satisfy the oconnor or brennan standard (split ideas) for purposeful availment in Asahi? o OConnor Standard the defendant must have intended for its product to be marketed in the forum state in order to have purposefully availed itself of the forum o Brennan Standard The defendant merely must have been aware that its product would be marketed in forum state in order to satisfy the purposeful 6

availment requirement of the international shoe test. Ex. International shoe o International shoe is a corporation that puts some of its employees in WA, and because they are working there, they have to pay because they have minimum contacts. o International Shoe set the standard: Held: In order to subject a defendant to a judgment in personam, if he is not present in the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice. Clearly Jurisdiction: Where defendant has engaged in continuous and systematic activities in forum and cause of action arises from those activities. Clearly NO Jurisdiction: Where defendant has engaged in only isolated sporadic activity and the cause of action does not arise from that activity. General Jurisdiction: Where continuous and systematic activities in forum but cause of action is unrelated to those activities. If your activities are substantial (i.e. you have permanent employees), then you are really present. The defendant is doing enough in the state that you are treated as being there no matter what the cause of action. Specific Jurisdiction: Where defendant has only isolated, sporadic or limited activity, but cause of action arises from that activity. When cause of action is related to action in the state its called specific jurisdiction, when the cause of action is unrelated to the state it is called general jurisdiction. McGee v. International Life Insurance: Only one life insurance policy the only policy the company held. TX company, CA insurer, mom tries to recover, doesnt

want to go to TX to sue, so does it in CA, but they still wont pay. This ONE contact in CA was enough to hold the insurance company accountable. Minimum Contacts in a Contract Case: o Prefer the purposeful availment approach to determine minimum contacts o Burger King v. Rudzewics: Factors to consider for jurisdiction over a contract: The nature of prior negotiations between parties The contemplated future consequences of entering into the contract The terms of the contract The course of dealing between the parties. In this case: Rudzewicz chose to negotiate for a franchise with a FL company when he could have chosen to establish a franchise of a company based in Michigan or many other states. Rudzewicz knew that he would derive many benefits by being affiliated with Burger King because of its national reach. The terms of the contract clearly indicate that Burger King conducts its operations out of Miami. Rudzewicz clearly learned from his dealings with Burger King that the decision making power lay in the Florida headquarters and not the Michigan district office.

Intentional Torts o Look at purposeful direction of the case who is it directed at? o Ex. Calder v. Jones Intentional tort case a Florida newspaper slandered Jones, California resident. The newspaper did not contest jurisdiction, but they argued that the publisher and editor of the magazine could not personally be sued in California 8

because they personally had no connections to California. The US Supreme Court found that the California courts did have personal jurisdiction over the editor and publisher. Intentional tort case if an intentional tort has been alleged, has the defendant intentionally targeted its tortious conduct at a forum resident and caused harm to that resident in the forum? If so, then personal jurisdiction over the defendant in the forum state is appropriate under the calder effects test

effects test Actions outside forum causing effects inside forum o Dudnokov case Betty boop art Developed a 3 part test to determine purposeful direction Intentional action Expressly aimed at forum state Knowledge that the brunt of the injury would be felt there Negligence tort and products liability o Stream of commerce theory o Cant just put into forum has to be foreseeable o Ex. Volkswagon case Internet Cases - Zippo o Sliding Scale Test: Minimum Contacts and the Internet At one end, cases where defendant clearly does business over the internet (active website) Middle ground where defendant has an interactive website Other end, passive website. Merely posting information, there is no communication through the Internet. Set forth in Zippo P = PA, D = CA. Cause of action = trademark infringement. D contacts with PA: has contracts with 7 Internet subscribers in PA; they post 9

information and ads on the web; and have 3,000 subscribers in PA. o This was an ACTIVE website because they do a lot of business over the website and they deal with the 7 Internet providers and have 3,000 subscribers. This is not merely an interaction. So this CLEARLY satisfies the minimum contacts. o If an intentional tort is alleged, the effects test of Calder can be relevant. o Also look at if internet activity was specifically aimed at the forum state Modern case trying to hash out rules of Personal Jurisdiction: o J. McIntyre Machinery, Ltd. v. Nicastro Nicastro injured by McIntyres Machinery. McIntyre is a manufacturer in UK but uses a distributor to sell to all over US. Majority is that McIntyre doesnt have jurisdiction in NJ because McIntyre did not engage in conduct purposefully directed at New Jersey. * Majority - Justice Kennedy focuses on the sovereign power to make the decision Focus is on the defendants conduct within a given forum or sovereign and the forum/sovereigns power to subject the defendant to a judgment concerning that conduct What the defendant has done to give the forum power, authority over the defendant *Blum agrees with dissent by Justice Ginsburg, Sotomayor, Kagan McIntyre attending all the conventions to sell its products shows that they wanted to sell there product all over the US. McIntyre delt with US as a single market, not state by state by using the distributor and therefore purposefully availed itself 10

B. RELATEDNESS MOST IMPORTANT PART Does Cause of Action Arise out of or Relate to Contacts of D in forum state ? (specific pj) o Specific personal jurisdiction Requires: (1) the defendant has purposefully directed his activities at the forum state or purposefully availed himself of the privilege of conducting business in that state, and (2) the alleged injury arises out of the defendant's forum-related activities and (3) the exercise of jurisdiction must comport with traditional notions of fair play and substantial justice (reasonableness) o If tort cause of action and contract connection (Marino, Tatro, Nowak) but for connection ? (weak nexus) but for contacts in forum, injury would not have occurred proximate cause connection? (strong nexus) contacts in forum = legal cause of injury; relevant to asserting legal claim courts prefer this gives defendant more foreseeability If c/a does not arise from or relate to forum activity, is there enough for general personal jurisdiction? General Personal Jurisdiction o To tell if its general jurisdiction ask yourself would it be reasonable to sue the person about anything in the forum? o You have so much going on in the forum that it would be reasonable to sue you about anything in the forum, doesnt have to be forum related at all o Domicile (where your true permanent, fixed, home) is the one thing that if you have that in a forum the forum has general jurisdiction over you

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o the partys contacts with the forum state must be continuous, systematic, and substantial. o Ex. Helicopteros Nacionales v. Hall Plaintiffs sued helicopter company, in Texas court after a helicopter crash in Peru. Heli is a Colombia corporation which was engaged in a joint venture based in Texas and had some contacts with Texas. But court ruled that there wasnt general jurisdiction because for general jurisdiction the contacts have to be systematic and continuous Brennan Dissent: because a lot of contacts in TX should have general jurisdiction o Goodyear Dunlop Tires Operations v. Brown Two boys from North Carolina died in a bus accident that occurred in France. Said it was because of faulty tire which was made in Turkey. A small percentage of their tires were distributed within North Carolina by other affiliates. The Supreme Court determined that it wasnt general jurisdiction because it wasnt continuous and systematic. C. REASONABLENESS Analyze reasonableness according to Asahi gestalt factors, noting that a balance of the first three are typically most important o i. Burden on the defendant would the inconvenience to the defendant be unconstitutionally burdensome, meaning it would impact the defendants ability to mount a defense? A yes answer would weigh against reasonableness o ii. State interest Does the state have a strong interest in resolving the dispute? The states interest is greater where its laws or policies are at stake, or where state citizens or corporations are involved. An affirmative answer here weighs in favor of reasonableness. o iii. Plaintiff interest Does the plaintiff have a strong interest in obtaining relief in the forum? If so, that is a factor in favoring reasonableness.

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o Iv. Systemic efficiency would jurisdiction promote the interstate judicial systems interest in efficient resolution of controversies? o V. furtherance of social policies would jurisdiction promote the shared interest of the states in furthering fundamental substantive social policies? IN REM JURISDICTION In rem jurisdiction o Because a state is all powerful within its boundaries it can have jurisdiction over any property within its boundaries Quasi-in-rem (Type I) o Jurisdiction over property for purpose resolving rights of particular individuals in ownership or interest in property. o Example: Foreclosure action Quasi in rem jurisdiction (Type II) o The defendant has property in the state, the defendant isnt in the state, the cause of action has nothing to do with the state, but the state has power over the property o Can be bank account, land ect. o Before Shaffter v. Heithner Enables the state to seize the property and say if we have your property we have you, even though the dispute has nothing to do with the property or forum state Validated in penoyer v. neff There is an inherent unfairness about it o After Shaffter v. Heitner supreme court said now all principles of shoe, now need minimum contacts, fair play and substantial justice Knocked out most of the utility of quasi in rem because if you have all shoe elements you might as well have personal jurisdiction Now its used when long arm statue doesnt allow for personal jurisdiction in specific situations Harris v. Balk o Supreme court ruled The debt clings to debtor and may be attached wherever he is found. Harris was carrying around 13

balks debt or property so wherever harris goes, balks property goes. Property could serve as the basis for jurisdiction. Before Shaffer v. Heitner. Shaffer v. Heitner o Heitner who owned 1 share of greyhound brought a suit against 28 Greyhound directors for mismanaging the company in Delaware even though no he or they werent in DE because in DE having 1 share counts as property. Supreme court found that jurisdiction cannot be founded on property within a state unless there are sufficient contacts within the meaning of the test developed in international shoe (minimum contacts). o Some Cases Unaffected Where controversy is about the property Where claim arises from Ds ownership of property in forum o Cases Affected Cases where property is totally unrelated to Ps cause of action & D has no other ties with forum

Burnham v. Superior Court of California o After he was personally served with summons while vising San Francisco, Burnham contended that California lacked personal jurisdiction over him because his only contacts with the state were a few short visits there to conduct business and to visit his children. The court ruled that personal jurisdiction based on physical presence alone is ok and does not violate due process. o state courts have jurisdiction over non residents who are physically present in the state. o personal service upon a physically present nonresident is sufficient to confer jurisdiction, regardless of whether he was only briefly in the state of where the cause of action was related to his activities there. Continuous and systematic contacts with the forum are not necessary.

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o The minimum contacts requirement developed in international shoe only applies to situations in which the defendant is not present within the territory of the forum. DUE PROCESS AND SERVICE OF PROCESS Rule 4 o Due process of law guarantees parties the basic right to notice of courts intention to adjudicate their rights and an opportunity for those parties to be heard before the court proceeds to do so o Process : notice of civil action given through service of process Summons : Courts official notification to D Complaint : Ps statement of claims v. Defendant o Process v. Personal Jurisdiction PJ may be ok but service not ok service may be perfect but there may be no personal jurisdiction o Highlights of Rule 4 4(c)(2) personal service may be made by any person who is over 18 and not a party to the action. In most cases, plaintiffs counsel will hire a constable or professional process server to serve the papers

4(m) specifies that service of process must be made within 120 days of filing the complaint, or the action may be dismissed 4(d) Waiver authorizes the plaintiff to solicit a waiver of all these technicalities by sending the defendant the complaint, two copies of a notice of the action and a request that the defendant is suffused to return the request, thus waiving formal service Note: Waiver of service of process does not waive jurisdictional or venue defenses form sent 1st class mail 15

copies of complaint & notice D has 30 days from date sent to respond Incentives to Waive If D does not comply, must pay costs of service of process If D timely returns waiver before being served with process, D gets 60 days from date that request for waiver of service was sent to answer complaint 4(e) : service on individuals governs service of process on an individual defendant provides 5 different methods for service process on individual defendants in federal suits the plaintiff may choose whichever he prefers the three traditional methods are found in (e)(2) o 1. authorizes service of process by personally delivering the summons and complaint to the defendant o 2. or by leaving copies of the summons and the complaint at his dwelling or usually place of abode with a person of suitable age and discretion residing therein o 3. or by delivering papers to an agent appointed by the defendant to receive service of process on his behalf (e)(1) o 4. there is an option to serve individual defendants under the provisions governing service on individuals in the courts of the state where the federal court sits

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ex, the plaintiff in an action in the federal district court in MA may use any methods of service for service of process on individuals that apply in the MA superior courts o 5. Authorizes service pursuant to the law of the state where the defendant is actually being served ex. Vaughn brings suit in the federal district court for the District of MA against Spenser, who lives in ME, and whished to serve process on Spenser there. Vaughn is authorized to use any method for service on an individual defendant authorized by the ME service rules, since that is the state where service is made 4(h) : service on corps specifies methods of service of process on corporations or other entities (such as partnerships or unincorporated associations) if defendant is served in the US (h)(1) applies the available methods parallel the methods for service on individuals under 4(e) o i.e. service may be made by delivery for a copy of the summons and complaint to an office, managing or general agent of the defendant, or to an agent authorized to receive service of process, or by a methods prescribed by the law of the state where the federal court sits or by a methods prescribed by the law of the state in which process is to be served on the defendant. if defendant is served outside the US (h)(2) applies 17

Rule 4(k)(1)(A) if the state long arm statue authorizes jurisdiction in the circumstances of the case, and it would be constitutional for the state court to assert jurisdiction under a due process analysis then the federal court may do so 4(k)(2) : Federal Long-arm provides that the legislature authorized jurisdiction and that service of process is effective to establish jurisdiction in federal question cases,

over parties who have sufficient contacts with the US as a whole to constitutionally support jurisdiction, but whose contacts would not suffice to support personal jurisdiction in the courts of any state SUBJECT MATTER JURISDICTION STATUORY TICKET - 1331 If one federal court has jurisdiction, every federal court has jurisdiction General Subject Matter Jurisdiction - 28 U.S.C. 1331 o Rule of civil procedure 8(a)(1) Requires statement of subject matter jurisdiction in every complaint submitted to federal court You need a federal question ticket to get into federal court Allows you to file your complaint and tell the court they have jurisdiction because of 1331 and you tell the federal court what federal law youre asserting here You cant waive lack of subject matter jurisdiction o Start with U.S. Const. Art. III 2 Sets out the kinds of cases to which the federal courts shall extend Provides that judicial power shall extend to all cases arising under the Constitution, laws or treaties of the U.S. Aka arising under jurisdiction 18

Osborn broad test for determining what arising from means When a question to which the judicial power of the union is extended by the constitution, forms an ingredient (claim or defense) of the original cause, it is in the power of Congress to give the lower federal courts jurisdiction of that cause, although other questions of fact or law may be involved in it For federal law to be an ingredient of the case,

one of the parties in the case would have to rely on federal law to establish either a claim or defense in the lawsuit, or at least raise a federal issue in proving her case Very broad o Then move to Statutory Ticket :28 USC 1331 if you satisfy this you dont need diversity Needs to be statutory authorization to exercise jurisdiction due process is not enough similar to how in personal jurisdiction you have to satisfy the statue long arm statue The difference between 1331 and article III is that 1331 is much stricter you need BOTH constitutional power and Statutory Authority o Louisville & Nashville RR Co v. Mottley When the railroad refused to renew the free limetime passes given to them Mottleys for release of their claim for damages for injuries sustained while they were passengers on the Railroad, the Mottleys brought this suit in federal court in Kentucky. For a plaintiff to sue in federal court under the statutory test for arising-under jurisdiction, she must assert a claim that arises under federal law. The Mottleys case do not: they had sued for breach of contract, a state law cause of action that did not require them to prove any proposition of federal law 19

Well pleaded complaint rule Does the essential federal element appear on the face of the plaintiffs well-pleaded complaint Not enough to anticipate a federal defense or defense which P claims is invalidated by provision of Constitution the court is able to determine at the outset whether it has jurisdiction, based on the claims the plaintiff has asserted, without waiting for the defendants answer Holms test Test for determine when Mottleys well-pleaded complaint rule is met The holms test would find jurisdiction under 1331 if the source of the plaintiffs enforceable legal right against the defendant is federal law In Mottley, the source of the plaintiffs right to demand relief from the court was state contract law

If a case meets the holms test, it does arise under federal law for purposes of 1331 o Nashoba Communications v. Town on Danvers Nashoba (cable company) seeks declaratory judgment that rate freeze provision of its K with town of Danvers violates the federal Cable Act of 1984 A reverse motley situation just as if railroad went in first to get a declaration, court would look at what the issue is (contract claim) and not grant jurisdiction in federal court o Declaratory Judgment Act: 28 USC 2201 Lets someone who is a potential defendant go into court first and get a declaration of rights (can say that their protected from getting sued) does not expand the subject matter jurisdiction of the federal district courts 20

Thus, ask whether there would be smj jurisdiction absent declaratory judgment statute In Nashoba it would just be a contract case DIVERSITY & AMOUNT IN CONTROVERSY 28 U.S.C. 1332 (MUST HAVE BOTH IF NO STAUTORY TICKET) SUBJECT MATTER JURISDICTION Diversity of Citizenship o Art III, 2 extends judicial power to controversies between citizens of different states o Article III 2 Authorizes jurisdiction over all diversity cases, regardless of sum in dispute o Under 1332 Narrower than Article III 2 Amount in controversy requirement - claim is for more that $75,000, o Needs to be complete diversity all plaintiffs in a suit are from different states than all defendants at the time suit is brought o Different ways to have diversity 1332 1332 (a1) citizens of different states Ex. Ma vs. NY (a2) diversity jurisdiction if you have citizens of a state and citizens of a foreign state ex. Ma citizen v. France citizen 1332 (a3) citizens of different states and in which citizens of foreign states are additional parties ok because citizens of different states are on the other side of the v France & MA v. NY & france 1332 (a4) Foreign state as plaintiff and citizens of state or different states France v. NY & MA 21

o Domicile To be a state citizen you have to be domicile there established by: physical presence intent to remain indefinitely note that indefinitely does not mean permanently Factors Considered establishment of home place of employment bank accounts, assets tax returns registration of vehicle drivers license registered to vote only one domicile o Kennedy v. Trustees (S.D.N.Y. 2009) Guy claims to be Kennedys son and wants some of his inheritance. Court says no. Ankenbrandt case Federal courts dont deal with domestic relations (divorce, alimony, and child custody decrees) Filing of the complaint is where you look to determine is there diversity jurisdiction o Hertz Corp. v. Friend (2010) RECENT CASE USE NERVE Friend and Nhieu sued hertz in California. Hertz wanted to go to federal court claiming they were citizens of different states. Supreme court says use nerve test to determine. Nerve center of corporation is the corporate headquarters or home office form which its activities are coordinated o Corporate Citizenship Before 1958 corporations were citizens of just place of incorporation the following was added as an amendment after that

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Idea was to cut back on corporations ability to bring about diversity jurisdiction 1332(c) : corp. = citizen of any state where incorporated and the state where it has its principal place of business 1332(c) applies to alien corps with principal place of business in the United States Circuits had used variety of tests for determining p/p/b nerve center test : focus on corporate brain; where headquarters located (7th Cir.) the one the supreme court adopts in Hertz center of corporate activities: focus on day-to-day corporate activities and management (3d Cir. ) place of operations test: state where corporation has substantial predominance of its business activities, in terms of plants, employees, assets, etc... (9th Cir.) Total activities test: looks to nerve center,

business activities, and total activity of corporation considered as a whole (5th, 6th, 8th, 10th, 11th) 1st, 2d, 4th Circuits: place of operations or, if farflung activities, nerve center Amount in Controversy o Congress has chosen to keep minor diversity cases out of the federal courts by providing that such cases can only be brought there if the amount in controversy exceeds $75,000 o The over $75,000 must be whats in controversy not just when the plaintiff will recover over $75,000 o How to measure injunctive relief stopping someone from doing something Value to plaintiff or Cost to defendant in excess of 75k its satisfied

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o Courts face an awkward problem in applying the amount-incontroversy requirement, particularly in cases that involve intangible damages such as pain and suffering Because of this they came up with the St. Paul Mercury rule the court must find the amount in controversy requirement is met unless it is quite clear that there is no way the recovery will reach $75,000.01 Sum claimed by P controls if made in good faith Need only show that its not a legal certainty that the plaintiffs claim involves less than the jurisdictional amount Heavily weighted towards the plaintiff Where he will probably get less, but just might get more, it is deemed satisfactory o Aggregation rules 1. Where a single plaintiff asserts two or more claims against a single defendant, the amounts may be added together to reach the required amount 2. A single plaintiff cannot aggregate amounts sought from different defendants. He must meet the amount requirement against each individually. 3. If a plaintiff sues one defendant for more than 75 and a second for less, he cannot bootstrap the insufficient claim onto the other 4. Plaintiffs may not add their claims together to meet the amount requirement 5. Supplemental Jurisdiction as long as one plaintiff asserts a claim that satisfies the amount requirement,

others may join as co-plaintiffs even thought they are seeking less that 75, as long as there is only a single defendant o American Fiber & Finishing, Inc. v. Tyco Healthcare Group AF & F destroyed diversity jurisdiction when it amended its complaint and jettisoned Tyco International (a diverse party) in favor of Tyco Healthcare (a non diverse party). Tyco Healthcare is a limited partnership 24

= takes on citizenship of every general or limited partner and in this case one of the partners is in the same place as AF & F so there is no diversity o Freeland v. Liberty Mutual Fire Ins. Freelands suing for more money for insurance after a car accident. Liberty wants to give them 25k each $75,000 1 cent less than allowed. They want $100,000 each. Court says it cant hear the case because the amount in controversy has to exceed $75,000 SUPPLEMENTAL JURISDICTION 28 U.S.C. 1367 Before 1367 was passed: o Frequently, the rules of civil procedure will authorize joinder of claims over which there is no independent basis of subject matter jurisdiction o Two doctrines evolved to support jurisdiction over such related claims in federal court Pendent jurisdiction So long as the plaintiff asserts a proper claim based on federal law, diversity, or some other federal ground, the federal court has the power at least the constitutional power to hear other claims arising out of the same common nucleus of operative facts Once the judge ascertains that he has power to hear the claim, because it is part of the same case he must then determine whether it makes sense to exercise that jurisdiction

non federal claim introduced into the litigation by the plaintiff Ancillary Jurisdiction Courts extended this to many claims asserted by defending parties that bore a logical relationship to the main claim non federal claim introduced into the litigation by parties other than the plaintiff 25

Claims that are non-federal introduced into the litigation by parties other than the plaintiff, subsequent to the filing of the complaint (counterclaims) Ex. P from MA suing D from MA with a federal question and the D wants to counterclaim a state matter. Statutory limitations o even though jurisdiction could possibly be found under pendant or ancillary, the court also has to decide if it conforms to the statue writers wishes and purpose of creating the statue of when the statue should apply Gibbs Test: o Question of constitutional power (Article III): Does the claim arise from the common nucleus? Federal and state claims must arise from common nucleus of operative fact so closely related, if you have that, then the non-federal claim is going to come in on pendent jurisdiction o Question of discretion. NOTE: Just because the power is there, you dont have to exercise it. This is not a right to hear this, but they may if they want to. Some factors in determining if they want to hear this pendent claim or not: Judicial economy, fairness to litigant, convenience Jury confusion Predomination of state law issues Whether federal claim dismissed No discretion if they want to hear the federal question claims, but they can use their discretion to hear the pendent claims and they may or may not want to because of these four reasons.

Aldinger v. howard o Held: no power, under article III it passes the Gibbs test, the problem was there was no statue that authorized this kind of 26

jurisdiction, because youre bringing in a pendant party with no diversity, or no federal question, and they interpreted the statue into meaning that it wouldnt authorize federal jurisdiction. o Now a 3 part test: 1. Article III Power Question 2. Statutory Authorization Question 3. Discretion Question Owen v. Kroger o The problem was that there was no statutory authorization, because complete diversity is required by 1332 statue o Would come out the same even after 1367 (a) Finely v. US o Finley sued FAA because of plane crash in CA and this claim against the federal agency has to be brought in federal court. Finely has a bunch of state law claims too and they all arise out of common nucleus. But the supreme court says they are missing the statutory authority to hear the state claims. Scalia said this doesnt really make sense because Finely will have to go to federal and state court, so if congress wants to fix this they should, and then they did because of this 1367(a) 28 U.S.C. 1367 (a) o in 1990 congress clarified the authority of the federal court to entertain claims that are related to proper federal claims, but are not jurisdictionally proper in themselves o any civil action of which the district courts have federal jurisdiction, once you get in the door the court will have supplemental jurisdiction under all other claims that are related to the federal claim that they form part of the same case or controversy under Art. III o * Talk about this on test if relevant pendant claim issue - supplemental jurisdiction shall include claims that involve joinder or invention of additional parties, now statutory authorization to hear pendant claims a response to Finley 27

o if the plaintiff brings a proper federal claim or diversity claim, so that the federal court has original jurisdiction, the court may hear all the claims that are part of the same case or controversy under Article III o authorizes the courts to hear all claims that arise out of the same nucleus of operative facts as the proper federal claim. This includes additional claims asserted by the plaintiff, but also those asserted by other parties as well, such as crossclaims and counterclaims o by enacting 1367, congress provided the necessary statutory authority to hear the related claims o 28 USC 1367 (b) if the case is in federal court on diversity jurisdiction, then 1367(b) carves out exceptions to supplemental jurisdiction o 28 USC 1367 (c) Codifies factors to be considered by court in exercising discretion to hear/not hear supplemental claims Supplemental Jurisdiction may be DECLINED if: Novel/complex issue of state law State claims predominate Federal claims dismissed In exceptional circumstances, other compelling reasons. 3 part analysis in analyzing 1367 o 1. Constitutional power (Gibbs) The court must determine whether there is constitutional power under Article III, 2, to hear the supplemental claim this analysis stems from Gibbs Test: which held that the constitutional power to hear the related claim exists if there is a proper claim within the jurisdiction of the federal court and the related claim arises from the same nucleus of operative facts o 2. Stautory Grant of Jurisdiction 28

1367(a), with exceptions carved out in 1367(b) The court must determine whether there is a statutory grant of jurisdiction over the related claim as long as the federal court has a basis for original jurisdiction over the case, 1367(a) broadly grants statutory authority to hear related state law claims that meet the Gibbs test o 3. Discretion Analysis look to 1367(c) factors Exxon Mobil Corp. v. Allapattah Services, Inc. (2005) o 1 plaintiff in each case that satisfies amount in controversy, there is complete diversity o *no supplemental jurisdiction when there isnt complete diversity o problem raised is there is complete diversity but some plaintiffs that dont satisfy amount in controversy can they still be heard and ride in on the coattails of ones who do satisfy the amount? o There is no Article III problem, problem is the statutory authorization, which has to come from 1367 o Court says in 1367(a) its enough to have 1 plaintiff thats diverse and satisfies the amount in controversy and the rest can come in on that o 1367(b) doesnt say anything about claims by plaintiffs that are joined together, it only says no supplemental jurisdiction over defendants who are joined together, court says the bottom line is that the plaintiffs claims can be asserted under 1367(b) because the statue doesnt specifically say anything

about plaintiffs, just talks about defendants. REMOVAL 28 U.S.C. 1441 Def o The traditional rule in American courts has been, and largely still is, that the plaintiff chooses the forum in which to bring a suit, subject to the limitations of personal jurisdiction, subject matter jurisdiction, and venue. In short the plaintiff is master of his claim 29

Removal is an exception to this o The federal removal statues allow the defendant, after the plaintiff has chosen a state court, to second-guess that choice by removing some types of cases from the state court to a federal court Removal problem rules o Plaintiff cant after removal join a defendant that conflicts with diversity o Case can be removed if corporation changes principal place of business and there is now diversity, has to become removable then remove and happens in 30 day period o If a case is filed in federal court and no one notices there is no SMJ bc of diversity the defect can be cured bc of rule 21 a dispensable party can be removed only if dispensable! o All of the defendants have to join in removal Policy reason for removal o The rational for removal is that defendants as well as plaintiffs should have the option to choose federal court for cases within the federal jurisdiction Time period for removal o General rule is you get 30 days to remove from the time the complaint is served, or 30 days from when the diversity confliction is resolved (if a non diverse party settles or drops out), cant be longer than a year o In a case that is removed, SMJ is determined at the time of removal 28 U.S.C. 1441(a), (b) o (a) only authorizes removal of state court actions of which the federal district courts have jurisdiction the only court that can host a removal action is the federal district court for the district and division where the action is pending in the state court the usual federal venue rules do not apply in removed actions

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Where civil action filed in state ct is one that could have been brought originally in federal court, D(s) may remove to district court embracing place where action is pending if a any defendant is sued in his home state, he may not remove on the basis of diversity the rational is that the defendant doesnt need to be protected from local prejudice, since he has been sued in his own home state

o (b)

If federal question jurisdiction, D can remove without regard to citizenship or residence of D If diversity jurisdiction, not removable if any D = citizen of state where filed If its a federal question case, then the defendant can remove regardless of their citizenship The minute you see federal question its okay to remove 28 U.S.C. 1446(a), (b) o (a) the state court complaint and answer (if one has been filed before removal) will be filed with the notice of removal

1447(c) o if at any time before final judgment it appears that district court lacks smj, the case shall be remanded Rose v. Giamatti (S.D. Ohio 1989) o Rose sued Giamatti, Major league baseball, and the Cincinnati Reds. Giamatti wanted to remove to federal court. The court found that MLB and Cincinnati reds were not relevant to this case and not diverse so they were dropped from the case. The court also found that the federal court does have jurisdiction over Rose and Giamatti and that Giamatti did not wave his right to remove this action. If the plaintiff names non diverse parties as defendants you cant remove because there is not complete diversity. 31

o For unincorporated associates you look to citizens of every state in which each of its members is a citizen to find diversity Capterpillar v. Lewis: o Q: Whether statutory flaw that existed at time of removal (failure to satisfy 1441(a)) was cured by eventual dismissal of non-diverse defendant before judgment? Power under Art. III is there because you just need minimal diversity. NOT satisfied under 1332 because there was not complete diversity. Too much of a burden to go to state court just because of statutory mistake o RULED: the defect in essence was cured and we shouldnt let this statutory flaw ruin it. Note: IF at the end of the day and the case, a jurisdictional defect remains uncured, the judgment must be vacated. Groupo Dataflux v. Atlas Global Group: Differences between this case and Caterpillar: had a non-diverse party thrown out in Caterpillar. This was a PARTY that CHANGED its citizenship by reorganizing. This is NOT something that can be cured. No party was dismissed here simply a change of citizenship of an existing party. Change in composition does not equate to a change of party. There was NOT EVEN MINIMAL DIVERSITY here at the time of filing (doesnt even fall under Art. III) because at the time of filing, there were no opposing parties who were not co-citizens.

VENUE = locality 28 U.S.C. 1391(a)-(d) def o Venue rules are meant to further restrict the places where the plaintiff may choose to bring suit, to assure that suits are tried in a place that bears some sensible relationship to the claims asserted or to the parties to the action

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o Creature of a statute and it is for the convenience of parties, witnesses and courts. It is the 3rd ring they have to jump through and it narrows down what can be brought and where. 3 rings PJ, SMJ, and Venue Waiveable defense - Venue and PJ: if defendant does not raise it, then it is disregarded Note: Statute does not apply when special venue statute addresses case. 1391 & Removal o Also IMPORTANT: Statute does not control cases removed under 1441 (removal) or special venue statues The removal statute tells you that proper venue, proper district court is only one place and that is the district that embraces the place where the state court claim was filed. How its different than PJ o (a)(b) differ from PJ in that a person who is subject to PJ in a state is subject to jurisdiction anywhere in that state 28 USC 1391 o A. Where diversity = sole basis for SMJ, venue is ok: 1. In a district where and defendant resides (domicile), if ALL defendants reside in same state if multiple defendants or A. The minute you see defendants from different states, forgo 1391(a)(1) for choice of venue. They all need to be in the same state if you want to exercise this one. Venue would be proper if A2 applies. B. Resides has been interpreted to mean where they are domiciled, same thing as citizenship. When talking about diversity SMJ, talk in terms of CITIZENSHIP, you can reside in any state, but you can only be a citizen of one for diversity purposes (voter registration, taxes, etc)

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2. In a district where a substantial part of events or omission giving rise to claim occurred or where substantial part of property subject of suit is located or A. Where did the substantial events take place giving rise to the cause of action? 3. In a district in which and defendant is subject to personal jurisdiction at time action is commenced, if no district in which action may otherwise be brought [under (a)(1) or (a)(2)]. A. Basically this is a fallback rule never will go

here. o B. Applies in federal question cases: 1. A judicial district where any defendant resides, if all defendants reside in the same state 2. A judicial district in which a substantial part of the events or omission giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated, or 3. In district where and defendant may be found if there is no district in which action may otherwise be brought [under (b)(1) or (b)(2)] A. Again, very rare, but it is a different fallback rule from (a) o C. Corporate defendant resides: 1. In any district where it is subject to personal jurisdiction at time action is commenced. 2. If more than one district in the state, look to district where subject to personal jurisdiction if district were a separate state. A. Basically do they have minimum contacts with that district instead of the state as a whole? 3. If no contacts are sufficient in one district, look to district where most significant contacts. 1391(c) tells you where a corporate defendant resides for purposes of applying 1391(a)(1) and (b)(1). Only applies when it is a corporate DEFENDANT. 34

ONLY appropriate when you are choosing venue under (a)(1) or (b)(1).

o D. Aliens: 1. Alien may be sued in any district in terms of venue 2. May apply to foreign corporation as well as foreign individual [but dont forget about personal jurisdiction must have both] A. A permanent resident alien is probably not subject to this provision. o how a3 and b3 differ (a3) and (b3) differ because (a3) allows venue in a district where any defendant is subject to personal jurisdiction, which (b3) authorizes venue in a district where any defendant may be found both of these subsections are fallback provisions that only apply if there is no district, anywhere in the United States, in which the case can be brought under the other subsections of the state. Smehlick v. A&A: Because A&A = corporate defendant, and this suit is based on diversity 1367(a)(1) and (c) apply here and will dictate if this is proper venue. Question here is whether the defendant has contacts with the Western District of NY that would be sufficient to subject it to personal jurisdiction if district were a separate state. Due Process Analysis: o Defendant had purposeful contacts with WDNY (phone and fax) o Cause of action related to contacts o Nothing unfair or unjust about D having to defend in WDNY Held: WDNY = proper venue under (a)(1) and no need for analysis under (a)(2)

ERIE DOCTRINE

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General question it resolves: when a federal court is enforcing a state created right, what law does the federal court apply? o Generally happens with diversity jurisdiction because if its federal question its federal law not state law Prior to 1938 o Courts used the Conformity Act dictated that federal courts follow state procedural law of state where sitting o also used Rules of Decision Act for substantive Laws of the several states, except where Constitution, U.S. treaties or Acts of Congress otherwise require or provide, shall serve as rules of decision in federal courts in cases where they apply State substantive law should be applied by the federal courts The problem stems not from the act but from the supreme court interpretation of the act Swift v. Tyson o Court interpreted laws of several states to mean those included in statutory laws but not state common law o Story believed the federal judges job was to choose the right decision, rather than to follow a rule that some other judge deemed to be the right one o Got this idea out of interpreting the Rules of Decision Act Ways swift failed o It didnt make a general common law amount federal and state court state courts went off on their own interpretations and decisions not following the federal court o Swift introduced discrimination in favor of the out-of-stater People can pick up and move and get diversity and get the result that they wanted by going to federal court when they didnt think theyd win under a state court They could basically pick where they wanted to be held Policy this doesnt protect the defendant from non local prejudice it gives them a huge advantage

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o Swift was unconstitutional, since it authorized federal judges to make law in areas in which the federal government has no delegated powers Erie Doctrine Includes o Rules of decision act, Erie, York, Byrd, Hannah Erie - 1938 o In the absence of controlling federal law, a federal court enforcing a state-created right, should apply state law, both statutory and judge-made (common law) o So basically, the Court found that when you are suing in a o o Federal court, you have to use the State's common law Overturn swift doctrine made it clear that on matters of substance state law controls unless there is special circumstances in which federal law governs 1945 Even if state law = arguably procedural (e.g., s/l), still apply state law in interest of achieving uniformity of outcome in enforcement of state-created rights

York o

o Policy: Want the outcome to be the same in federal court than it would be in state court so there is no advantage o Problem - strict outcome determinative approach had no stopping point you wouldnt be applying ANY rules of federal procedure so it could be tricky Byrd - 1958 o York is good Unless there is a strong , countervailing federal interest o Federal interest is slightly more important than outcome Hannah o Part 1 Erie Question = If federal court ignores or displaces state law in this case, will it affect the outcome of the case in such a way as to 1. encourage litigants (Ps by filing, Ds by removing) to seek the federal over the state forum ? or 37

2. foster unfairness in the administration of the laws (unfair edge to noncitizens) ? Court concludes that even if Erie analysis had been appropriate, displacing state law here would not have encouraged plaintiffs to choose federal forum o Part 2 - RDA & REA Analysis If you cant tell whether you use RDA or REA use both RDA Rules of Decision Act says rules of states should apply except where federal constitution, federal statue, federal treaty otherwise provides o In absence of controlling federal law, federal court should apply state substantive law when enforcing state created rights (Erie ) o Even if state law = arguably procedural (e.g., s/l), still apply state law in interest of achieving uniformity of outcome in enforcement of statecreated rights (York ) where twin aims of Erie implicated o RDA analysis questions to ask yourself 1. where ignoring or displacing state law would affect outcome so as to: encourage forum shopping? or result in unfairness in administration of laws ? 2. Use state unless there is a strong , countervailing federal interest 2. Rules Enabling Act If you are in except in the RDA then use Rules Enabling Act 38

REA authorizes SCt to make rules of practice & procedure for district cts & cts of appeals rules shall not abridge, enlarge, or modify any substantive right o How to analyze RDA REA on exam Is there a federal law on point here? If the answer is yes, analyze through REA If the answer is no, then state law applies How federal courts reconcile differences between federal and state procedural and substantive law: o In conflicts between a federal constitutional provision and state law, constitutional law trumps. o In conflicts between a federal statute and state law, federal law trumps. o In conflicts between a federal rule and state law, the federal rule trumps (if valid). o In conflicts between a federal judicial practice and state law, state law trumps if it is outcome-determinative (to prevent forum shopping).

TRANSFER Impact of transfer o Section 1404(a) provides federal courts with the discretionary authority to transfer a case to another federal district for the convenience of parties and witnesses, and in the interest of justice, where the plaintiff has chosen one district but it makes more sense to litigate the case in a different district In Van Dusen the court held that a transfer of venue under 1404(a) should effect a change of court but not a change of law. That is, the transferee court should apply the law that the transferor court would have applied if the case had not been transferred Put a bit more cynically, the transferee court should honor the plaintiffs forum-shopping choice, rather than allowing the defendants to displace it through transfer Transferor forum where its coming from 39

Transferee forum where its going to 1404 (a) o for convince the district court may transfer civil action to any other district or division where it might have been brought (where it could have been filed, in terms of pj, venue, smj) o where another federal court is more convenient forum we use the doctrine of transfer o forum non convenience results in dismissal, transfer they just pick up and move it o can only transfer from federal court to federal court 1406 o o o (a) Governs transfer from improper forum to proper forum court has choice of dismissing or transferring district court may transfer case under 1406(a) even when no pj over D in transferor court as long as its being sent to a district where it could have been brought Forum non conveniens o Common law doctrine (of Scottish origin) o applicable in federal courts where more convenient forum is in a foreign country o results in dismissal of suit from federal court o does not apply to transferring venue to other districts o if issues of pj, smj and forum non conviniens comes up court ruled you can address these issues in whichever way is easiest for example you shouldnt waste time finding pj if it should be transferred in forum non conviniens Piper aircraft v. reyno The possibility of change in substantive law should not be given conclusive or even substantial weight in the forum non convenience inquiry. o When a defendant seeks to transfer the law of the state they are transferring from follows them Ferens v. Deere & Co o

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o Whenever you have transfer under 1404 from proper forum to proper forum the law the from first proper forum applies doesnt matter if its a plaintiff or defendant transferring

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